Bequests are the transfers of wealth that occur upon a donor's death and that include transfers by means of a will or a trust. Bequests can take several forms such as:
- Specific bequest - a certain amount of cash, securities, or property.
- General bequest - property that is similar to all other items distributed, usually cash.
- Percentage bequest - a stated percentage of the donor's estate.
- Residual bequest - all or a portion of what remains of the estate after specific and general bequests are distributed.
Besides a straight bequest, you can also set up a trust that will benefit charitable organizations during or after your lifetime (such as a charitable remainder trust or a charitable lad trust). Another way to leave money is to name one or more nonprofits as beneficiaries of an insurance policy or as the recipient of your IRA or retirement fund.
A church endowment funds a ministry through income-earning assets held in perpetuity. In a traditional church endowment, anything that enters the principal cannot be touched, which allows the size of the fund to grow over time. Any withdrawals come from investment earnings, and thus don’t deplete the capital or assets available for investment activity. The fund may be restricted for specific purposes, particularly in the case of a large bequest which may be given to finance activities like church repairs. In other cases, church officials can decide how to use the money, and may have a mission statement and set of principles to use in making decisions.